The role of a Financial Director – a life in the spotlight
This week the Law Society published its paper on the impact of Brexit on the legal services market entitled: “Brexit and the Law”.
This extremely helpful analysis should read alongside two excellent papers published in December. The Bar Council’s Brexit Papers and TheCityUK’s Report on the Impact of Brexit on the UK-based Legal Services Sector. As each of these papers make clear, there are a huge number of complex issues that Brexit raises for the legal sector. Broadly these can be summarised as:
It is easy to see that the effect of each of these issues or their cumulative effect would damage the UK legal sector. This is an important part of the overall economy. The Law Society puts the number of people employed in private practice alone at 314,000. The market is worth around £30bn of which about 10% is net exports. It is the second largest legal market in the world (after the US) and dominates the European market.
It is therefore not surprising that each of the papers mentioned above urge the government to do all it can to preserve the status quo in Brexit negotiations. The Prime Minister made clear in her speech on 17th January that the UK will not seek to retain membership of the single market. Therefore, the only way in which the status quo could be maintained is by negotiating a special arrangement for legal services. At this stage in the process the realistic assumption must be that it is unlikely that such attempts will be wholly successful. Accordingly, we are going to face a period of disruption. However, it is worth putting these issues in context. The success of the UK legal services sector is based upon the following:
None of these factors are immediately put at risk by Brexit although clearly if Brexit has a negative effect on the economy as a whole, the legal sector will follow.
Indeed, you could say that the biggest challenges facing the UK legal services market is the growing competition from other jurisdictions outside the EU such as Dubai, Qatar, Singapore and the US. The growing importance of IT in the sector means that it is no longer necessary to be physically located where the labour or service is being provided, this means that free movement is increasingly less relevant. Indeed the biggest risk posed by Brexit may be to focus attention in the wrong direction.
Brexit is a big issue but it is not the only issue.
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